Hamner v. United States, 10393.

• Decision Date: 11 May 1943
• Docket Number: No. 10393.,10393.
• Citation: 134 F.2d 592
• Parties: HAMNER v. UNITED STATES.
• Court: U.S. Court of Appeals — Fifth Circuit

134 F.2d 592 (1943)

HAMNER v. UNITED STATES.

No. 10393.

Circuit Court of Appeals, Fifth Circuit.

March 29, 1943.

Rehearing Denied May 11, 1943.

COPYRIGHT MATERIAL OMITTED

Andrew M. Smith and Wm. G. B. Morrison, both of Houston, Tex., for appellant.

Brian S. Odem, Asst. U. S. Atty., of Houston, Tex., for appellee.

Before SIBLEY, HOLMES, and McCORD, Circuit Judges.

SIBLEY, Circuit Judge.

Appellant Hamner's motion to quash counts one and two of the indictment was overruled; a jury was waived, and he and two others were convicted and sentenced to fine and penitentiary imprisonment for conspiracy and for seven substantive offenses which were also charged as overt acts done pursuant to the conspiracy. Hamner alone appeals.

The motion to quash was in reality a demurrer, which included in its grounds that count one charged no crime, and that in its allegations as to the purpose of the conspiracy it was too vague and indefinite; and that count two did not charge any offense. The demurrer ought to have been sustained. The first count charged that co-defendants Pace and McGurk were both automobile tire dealers, and appellant Hamner operated another sort of business; that after Jan. 30, 1941, the Office of Price Administration was under cited statutes an agency of the United States engaged in enforcing and administering regulations concerning rubber tires and tubes for automobiles, one of which promulgated Feb. 19, 1942, forbade the sale or transfer of such without certificates from local tire rationing boards. It then proceeds to allege that the three defendants, beginning March 1, 1942, and continuing to the date of the indictment did unlawfully, wilfully, knowingly, corruptly, feloniously and fraudulently conspire together, and with other persons to the grand jury unknown, to commit offenses against and to defraud the United States in the following manner: From and since the 1st of March, 1942, the said defendants have attempted to make many purchases of new rubber tires and tubes for the purpose of and with the intent of enabling the defendants to make sales and transfers thereof to consumers and other persons without receiving certificates from local tire rationing boards; and said defendants did make sales and transfers to consumers in violation of the statutes, orders and regulations hereinbefore referred to. And the Grand Jurors further charge that in the acquisition of siad new tires and tubes said defendants made and caused to be made false, fraudulent and fictitious bills, receipts and vouchers relating to matters within the jurisdiction of the Office of Price Administration, being an agency of the United States. It is then alleged in the usual form that in pursuance of the conspiracy and to effect its object 23 overt acts were done, all before March 14, 1942.

Prior to the Second War Powers Act of March 27, 1942, 50 U.S.C.A. Appendix § 631 et seq. the rationing of rubber tires, and the regulations providing for rationing certificates to consumers, rested upon the brief provisions in the Act of May 31, 1941, 55 Stats., p. 236, 41 U.S. C.A. preceding § 1 note, which gave the President power to allocate materials important to the defense of the United States. This Act defined no crimes and fixed no penalties. The Emergency Price Control Act of Jan. 30, 1942, 50 U.S.C.A. Appendix § 901 et seq., besides authorizing price fixing, in Section 4 made it unlawful to sell and deliver any commodity, or to buy or receive it in the course of trade or business, in violation of price control regulations, and in Section 205(b) fixed criminal penalties therefor. Section 205(e) indicated a distinction between buyers "for use or consumption" and those "in the course of trade or business". This Act, Sect. 201(b), authorized the transfer to the Office of Price Administration therein set up of the function of priorities and rationing. No crimes or penalties were however fixed for violation of rationing regulations. The Second War Powers Act approved March 27, 1942, supplied this omission by amending in Sect. 301 the Act of May 31, 1941, so as to make the wilful violation of rationing regulations a misdemeanor. This was subsequent to the acts charged in the indictment. It is therefore argued that it was no offense against the United States prior to March 27, 1942, to buy or sell tires for consumption without a rationing certificate, and hence, if a conspiracy to do this is supposed to be charged, there is no offense against the United States in the alleged object of the conspiracy. In reply it is argued that the rationing regulations create an offense by imposing as a penalty on violators an inability to get more tires; and also that the United States would be defrauded, though the indictment does not say how. We do not pass on these doubtful questions, because we do not think the indictment with sufficient clearness charges a conspiring. Confused allegations of what the defendants did are by a sort of inference sought to be made allegations of what they conspired to do, as respects sales of tires without rationing certificates. The next sentence beginning: "And the Grand Jurors aforesaid do further charge and present, that in the acquisition of new tires and tubes the defendants made and caused to be made false and fraudulent and fictitious bills, receipts and vouchers", takes an entirely fresh start, and charges another substantive offense rather than any sort of conspiracy. Now the gist of the charge of conspiracy is the agreement to commit an offense against or a fraud on the United States. An overt act must be done pursuant to the agreement before, under 18 U.S.C.A. § 88, the crime is complete, but its essence lies in the agreement. That agreement must be distinctly and directly alleged. Inference and implication will not, on demurrer, suffice. Aid cannot be sought in the allegations of what was done in pursuance of it. 15 C.J.S., Conspiracy, § 82; 11 Am.Jur., Conspiracy, Sect. 29; Joplin Mercantile Co. v. United States, 236 U.S. 531, 35 S.Ct. 291, 59 L.Ed. 705; United States v. Britton, 108 U.S. 199, 2 S.Ct. 531, 27 L.Ed. 698. In the present case it is alleged generally that the defendants conspired to commit offenses and frauds, but it is not alleged what offenses and frauds were agreed to be committed. The pleader thenceforth alleges only what was done. What was done is often good evidence of what was agreed to be done, but to allege such evidence is not an allowable substitute for a clear statement of the agreement which is proposed to be proven. Such pleading invites the abuse of the conspiracy statute which has often happened by stating several substantive joint offenses and seeking conviction not only for them but for a conspiracy besides. Such a thing is legally possible, but it emphasizes the necessity for clear pleading of the conspiracy agreement as a thing to be proved separate and distinct from the substantive crimes. Count one is not such a pleading.

Count two charges that the defendants concealed and covered up by a trick, scheme and device a material fact within the jurisdiction of the Office of Price Administration in violation of Sect. 80 of Title 18, U.S.C.A., in that they acquired new rubber tires for the purpose of reselling them without rationing certificates and at excess prices, and did knowingly so resell them; and to conceal and cover up such acquisition did surreptitiously store them on the premises of Hamner, contrary to the statutes and regulations in such case provided. Section 80 criminates "Whoever shall knowingly and willfully falsify or conceal or cover up by any trick, scheme, or device a material fact * * * in any matter within the jurisdiction of any * * * agency of the United States." The regulations did require that in the transfer of new tires from dealer to dealer a bill or receipt be taken showing the number and kind of tires transferred and the name of the transferee. Pace and McGurk, as we shall see, did make false bills, naming the transferees untruly, and so fell afoul of Section 80, but we are referred to no regulation which required the tires to be kept at any particular place or exhibited to the Office of Price Administration. It is not apparent to us that the storing of them at Hamner's place of business, whether surreptitiously or not, was any such concealment from the Office of Price Administration of a material fact as Section 80 denounces. This count charges no crime, and should be stricken on demurrer.

Four of the substantive counts charge violations of Sect. 80 by making false representations in a matter within the jurisdiction of the Office of Price Administration by making bills and invoices of purchased tires in which the purchaser was untruly stated. The Office of Price Administration had made regulations under which dealers could transfer new tires to dealers without rationing certificates, but there was required to be taken a receipted invoice naming the purchaser who...